S ocioeconomic inequalities in health arise if (1) socioeconomic

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1 RESEARCH REPORT Income related inequalities in self assessed health in Britain: H Gravelle, M Sutton... See end of article for authors affiliations... Correspondence to: Professor H Gravelle, Centre for Health Economics, University of York, Heslington, York YO10 5DD, UK; hg8@york.ac.uk Accepted for publication 27 June J Epidemiol Community Health 2003;57: Study objective: To measure and decompose income related inequalities in self assessed health in England, Scotland, and Wales, Design: The relation between individual health and a non-linear transformation of equivalised income, allowing for sex, age, country, and year effects, was estimated by multiple regression. The share of health attributable to transformed income and the Gini coefficient for transformed income were calculated. Inequality in health was measured by the partial concentration index, which is the product of the Gini coefficient and the share of health attributable to transformed income. Participants and setting: Representative annual samples of the adult population living in private households in Great Britain The total analysed sample was people. Main results: Pro-rich health inequality was largest in Wales and smallest in England over the period because the effect of increased income on health was greatest in Wales and least in England. In all three countries, pro-rich health inequality increased throughout the period. In the early 1980s this was primarily attributable to increases in income inequality. Thereafter the increased share of health attributable to income was the principal cause. Conclusions: Reductions in pro-rich health inequality can be achieved by reducing income inequality, reducing the effect of income on health, or both. S ocioeconomic inequalities in health arise if (1) socioeconomic circumstances influence health status and (2) there are inequalities in socioeconomic circumstances. Both factors could be a focus for policy, and differences in either could account for differences in health inequality between countries and over time. Income is a broad measure of socioeconomic circumstances. It is unevenly distributed and strongly associated with health in all societies. 1 Average income in Britain has risen since the 1970s but income inequality has widened dramatically. 2 The evidence on trends in health in Britain is mixed: life expectancy has increased, 3 but self assessed levels of health status have shown little change. 4 Class related inequalities in mortality in Britain have widened steadily since the 1950s. 5 However, the trends in income related inequalities in self assessed health, and the extent to which they are attributable to widening income inequality, have not been established. Scotland and Wales have lower life expectancy than England, 6 and Wales has higher rates of reported chronic morbidity than the other two countries. 4 However, little is known about the extent to which the poorer health of Wales and Scotland is attributable to their lower income. 7 Moreover, there have been no studies of differences in the level of income related inequalities in health between the countries in Britain. Differences in income related inequality in health between countries must be attributable either to differences in the relation between health and income or to differences in the distribution of income. Similarly, changes over time in income related inequality in health must be attributable to changes in the income-health relation or in the distribution of income over time. It is an important first step in understanding differences or trends in income related health inequality to be able to attribute them to changes in the income-health relation or in the income distribution. In this paper we present a new method of decomposing income related inequality in health. We use it to compare income related inequalities in health across England, Wales, and Scotland over the period We show how cross country and temporal differences in income related inequalities in health in Britain can be linked 125 to changes in income inequality and to changes in the share of health attributed to income. METHODS Data Data on individual health and household income were obtained from 17 annual cross sections of the General Household Survey (GHS) for The GHS is a representative survey of private households in England, Scotland, and Wales. The annual sample size fell throughout the period from in 1979 to in The health question was asked only of people aged 16 and over. Information on income and self assessed health is available for people (81.6% of the initial adult sample). We omitted the 1st and 99th centiles of the income distribution to remove people reporting zero incomes and some very large income values that had disproportionate effects on the estimated income health relation. The resulting sample size is (80.0%). The measure of income is equivalised gross household income per week in 1995 prices. The equivalisation formula 8 was: Equivalised income=household income/ (adults children). Analysis We estimated the determinants of individual health using a recently proposed procedure that has been validated on good quality Canadian data. 9 Self assessed health is measured in the GHS as an ordered categorical response to the question How would you rate your health in general? Good, fairly good or not good. To increase the amount of information from the health measure we assume that health is in fact a continuous but unobserved variable (h s ) that lies between 0 and 1. A person who has h s between 0 and the critical value α 1 reports their health as not good. One who has h s between the critical values α 1 and α 2 reports fairly good health and one who has h s between α 2 and 1 reports good health. If we know the critical values, we can use interval regression 10 to estimate the

2 126 Gravelle, Sutton most likely value of h s for an individual given their reported health category, and their age, gender, and income. We obtain the critical values from the 1996 Health Survey for England (HSE). The HSE contains the EuroQol EQ-5D 11 health instrument that asks about five dimensions of health. The EuroQoL answers from respondents aged 16 and over were converted to a health utility scale between 0 and 1 using a set of weights for the UK based on the Time Trade-Off technique. 12 The quantiles of the resulting empirical distribution of HSE health utilities were matched with the cumulative frequencies of observations for the categories of self reported health (h s ) in England in 1995 from the GHS. For example, in % of the English GHS respondents reported not good health and 13.17% of the HSE respondents had a health score below Hence we set the critical value α 1 equal to Similarly we calculate α 2 = Once the critical values are determined the individual level health function was estimated by interval regression with robust standard errors using STATA 7.0. Here i indexes individuals, j indexes countries, and t indexes years. The variable y is equivalised income, f(.) is a transformation function, x is a vector of age and gender variables, and e ijt N(0,σ 2 ). Fixed effects for countries (u j ) and years (v t ) were estimated using vectors of dummy variables. The fixed effects specification of the multilevel model allows for correlation between the country and year dummies and the individual level variables. 13 Previous studies have demonstrated that the relation between health and income is non-linear We compared linear, logarithmic and power forms of the health-income relation. The log-likelihood of the model was minimised when f(y)=y 0.72, so that increases in income improve health but have a smaller effect at higher incomes. Measurement of inequality Wagstaff et al 1 reviewed measures of socioeconomic inequalities in health and suggested that the most appropriate was the concentration index. It is analogous to the Gini coefficient, commonly used as a measure of income inequality. The concentration index is derived by ranking the population by a measure of socioeconomic circumstances, such as income, and comparing the share of health accruing to people in differing circumstances with their share of the population. It has been widely used to measure inequalities in health and health care The concentration index may be a misleading measure of the extent to which inequalities in health are directly attributable to income if there are other factors that affect health and are correlated with income. For example, elderly people generally report worse health status and have lower incomes than the rest of the population. Part of the relation between health and income in the concentration index will reflect the effect of age on health and the correlation between age and income. The extent of income related inequality in health will therefore be overstated by the concentration index of health on income. Hence it has been suggested that the concentration index should be based on standardised health from which the influence of factors correlated with income have been removed. We used the partial concentration index (), which is equivalent to the concentration index for directly-standardised health. 23 The is Table 1 Interval regression analysis of self assessed health in Great Britain Coefficient t ratio Female Age Age Age Female * Age Female * Age Female * Age Income Wales Wales * Income Scotland Scotland * Income Constant Initial log-likelihood Model log-likelihood Pseudo-R % Number of observations 299,968 Tests of restrictions Year dummies = 0 χ 2 (16)=61.41 p< Income coefficient is time invariant χ 2 (16)=69.33 p< Wales = England χ 2 (18)=74.27 p< Scotland = England χ 2 (18)=38.64 p= Other variables entered in the regression but not shown are (a) year effects; (b) year and income interaction effects; and (c) interaction terms for (country * income * year) effects. The tests of the restrictions at the foot of the table indicate their joint significance. The age variable is (age in years)/100. where β is the income health coefficient from equation (1), and µ f(y) and µ h are the means of transformed income and health. Cy f(y) is the Gini coefficient for transformed income. The sign of the is given by the sign of the coefficient β. We expect β to be positive and a positive indicates that good health is disproportionately concentrated in the richest population groups. The takes a minimum value of 1 when the poorest person is the only person that is healthy and a maximum value of +1 when the richest person is the only person that is healthy. The provides a useful decomposition of income related health inequality as the product of two terms. The first βµ f(y) /µ h is the share of health attributable to income. Equivalently it is the proportionate health arising from a proportionate income, with all other factors affecting health held constant. Income related health inequality increases if the absolute effect (β) of income on health or the mean of transformed income (µ f(y) ) increase as these determine the overall effect of income on health. Note that if population health rises for reasons unconnected with changes in income, the share of health attributable to income decreases and so income related health inequality also falls. The second part of the is the Gini coefficient of transformed income, which measures inequality in transformed income. In the present case, where f(y)=y 0.72, the Gini of transformed income is less than the Gini of raw income but the two measures are highly positively correlated across years and countries (r=0.998). Increases in income inequality, as measured by the Gini of transformed income, increase income related health inequality. The and its component parts were estimated for each country for each year. Country specific, three year moving average values for the component parts were generated. The contribution of each of the four components to differences in the level of income related inequality in health between the start of the period ( ) and the end of the period (1993 5) and between the three countries in were estimated. Three year moving average values of the level of inequality of transformed income (Cy f(y) ) and the share of

3 Inequalities in health in Britain: Table 2 Components of income related health inequality in Great Britain, Income coefficient Mean (Income 0.72 ) Mean Health Gini (Income 0.72 ) Partial concentration index England Wales Scotland England Wales Scotland England Wales Scotland England Wales Scotland England Wales Scotland Year The income coefficients are derived from the regression in table 1, including the coefficients on the year dummies, the country dummies and the interactions of interaction of year and country dummies. Mean (income 0.72 ) is calculated by raising each individual s income to the power of 0.72 and then taking the mean. Mean health is mean individual health. Gini (income 0.72 ) is the Gini coefficient for (income 0.72 ). It is calculated by raising individual incomes to power of 0.72 and then cumulating the shares of the total of (income 0.72 ) with individuals ranked in ascending order of income. The partial concentration coefficient is the product of the income coefficient, mean (income 0.72 ), Gini (income 0.72 ) divided by mean health. Figure 1 Decompostion of trend in health inequality in Britain Points represent three year moving averages. Income denotes (income 0.72 ). health attributable to transformed income (βµ f(y) /µ m ) were plotted to show the evolution of income related health inequality in Britain over time. RESULTS The main regression results for the individual level health function are in table 1. Unsurprisingly, given the sample size, the individual level variables are highly significant. More important, their coefficients have plausible magnitudes and signs. Self assessed health is positively related to income, lower for women and decreases with age. Both Wales and Scotland have lower mean health and larger income-health coefficients than England. Country specific, annual estimates of the four components of the are in table 2. The income-health coefficient was largest in Wales and smallest in England in all years. Average (transformed) income was highest in England and smallest in Wales. Average health was consistently lower in Wales than in England and Scotland. Inequality in transformed income increased in all countries throughout the period. Income inequality in England was generally larger than in Wales and smaller than in Scotland. The final columns of table 2 show income related health inequality in the three countries. Health inequality was largest in Wales and smallest in England throughout the period. Figure 1 shows the decomposition of the time trend in income related health inequality in Britain. The horizontal axis plots inequality in transformed income as measured by the Gini coefficient. The vertical axis plots the share of health attributable to transformed income (the product of the first three sets of columns in table 2). The rectangular hyperbolae in figure 1 give combinations of the share of health attributable to transformed income and of inequality in transformed income which give rise to the same level of income related health inequality. The movement from lower to higher contours over the period shows the increase in income related health inequality. The was constant from 1980 and 1982 with increases in income inequality being offset by a reduced share of health attributable to income. From 1982 to 1989 income inequality continued to increase, with its effect on health inequality being reinforced and then offset by the rise and then fall in the share of health attributable to income. After 1989 income inequality changed little and the increase in the was attributable to increases in the share of health attributable to income. Table 3 shows the annual growth rates of the and its components for England, Scotland, Wales, and Britain. In

4 128 Gravelle, Sutton Table 3 Determinants of income related health inequality to Britain as a whole 55% of the increase in the was attributable to the increase in income inequality. The remainder of the increase was attributable to the increase in the share of health attributable to transformed income but, as the table shows, most of the the share was attributable to the increase in average incomes over the period. There was a slight decrease in the coefficient measuring the partial effect of income on health. Changes in mean health had little effect on the share of health attributable to transformed income and hence on the income related health inequality. Table 4 compares the relative difference in the and its components between England and the other two countries at the end of the period. The was higher in Scotland and Wales than in England (the relative differences were 6.5% and 18.6% respectively), even though income inequality was slightly smaller in both countries than in England. The main cause of the difference in income related health inequality was the effect of income on health, which is greater in Scotland (relative difference 13.1%) and Wales (relative difference 29.6%) than in England. DISCUSSION Summary of findings In , although Wales and Scotland had more equal distributions of income than England, they had greater income related health inequality. The main reason is that income had a greater effect on health in Wales and Scotland than in England. The principal causes of increased health inequality between 1979 and 1995 were rising income inequality and rising average incomes. Rising income inequality was the primary cause England Scotland Wales Britain Income coefficient % % % % Mean transformed income % % % % Mean health % % % % health attributable to transformed % % % % income Gini of transformed income % % % % Partial concentration index Based on change over 15 years between 1978/80 to 1993/5 (three year averages). Growth rate of x calculated as (ln (x t /x 0 ))/t. Table 4 Contributions of components of partial concentration index to relative difference between England and Scotland and Wales, 1993/5 England Scotland Wales Relative difference from England* Contribution of relative difference to relative difference in Relative difference from England* Contribution of relative difference to relative difference in Income coefficient % % Mean transformed income % % Mean health % % health attributable to transformed % % income Gini of transformed income % % Partial concentration index *Relative difference from England in variable x for country j is 100ln(x j /x E ), which can be approximated by the percentage difference (x j x E )/x E. Contribution of relative difference in x to relative difference from England in is 100ln(x j /x E )/ln( j / E ). Key points Differences in income related health inequality are due to differences in the level of income inequality and the share of health attributable to income. Health inequality is higher in Scotland and Wales than in England because the effect of income on health is larger. 55% of the increase in income related health inequality over the period was accounted for by the increase in income inequality and 45% by the increase in the share of health attributable to income The increase in the share of health attributable to income was due to the increase in average incomes rather than to changes in the effect of income on health. in the early 1980s. Subsequently, the main driver of the increase in health inequality was the increased share of health attributable to income. There was little the effect of income on health over the period. However, incomes increased, so that the product of the effect of income and the mean of (transformed) income increased, thus increasing the share of health attributable to income. Previous work has shown that Britain has wider health inequalities than would be expected for its level of income inequality 1 and that income differences between social groups in Britain are more important for health inequality than in Sweden. 24 Our results suggest that the share of health attributable to income accounts for the recent rise in health inequality in Britain and for the differences between countries within Britain.

5 Inequalities in health in Britain: Limitations of study The analysis has focused on health inequalities related to the distribution of current income. Previous studies have demonstrated that other socioeconomic variables have additional effects on health status 25 and that health may be more strongly related to permanent rather than current income. 26 We have used income as a composite indicator of economic status to summarise simply the relative importance for socioeconomic inequalities in health of (1) the effects of economic status on health and (2) the distribution of economic status across the population. Other methods are available for more detailed decompositions of health inequities to separate out the effects of income and of variables, such as education or housing, that are correlated with health and with income. A full analysis would require panel data but the only available panels do not cover a sufficiently long period to enable trends in inequality to be measured. Although self assessed health has been found to be predictive of mortality for all social groups, it is categorical and its use in inequality studies requires assumptions about the underlying unobservable distribution of true health. Experiments with other standard assumptions 30 yielded very similar results. Policy implications Reducing socioeconomic inequalities in health is a policy objective in many countries. Several commentators have drawn attention to the health implications of initiatives to reduce inequalities in socioeconomic circumstances. Our decomposition of the trend in income related health inequality over time reinforces but also qualifies such messages. Relatively little attention has been paid to initiatives that will reduce the effect of income on health. Our analysis demonstrates that the effect of income on health is an important part of the explanation of the cross country differences in income related health inequality among England, Scotland, and Wales. Consideration should also be given to attempts to reduce health inequality by reducing the effect of income on health as well as by reducing income differences. ACKNOWLEDGEMENTS Data from the General Household Survey and the Health Survey for England were made available through the ESRC Data Archive. The copyright holder, the original data producer, the relevant funding agencies and the Data Archive bear no responsibility for their further analysis or interpretation. The authors are grateful to Geoff Hardman for some of the data preparation.... Authors affiliations H Gravelle, National Primary Care Research and Development Centre, Centre for Health Economics, University of York, UK M Sutton, General Practice and Primary Care, Community Based Sciences, University of Glasgow, UK Funding: HG is funded by the English Department of Health through the National Primary Care R&D Centre. 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